Trump asks Democrats to negotiate on infrastructure plan

By David ShepardsonReuters

WASHINGTON (Reuters) - U.S. President Donald Trump urged congressional Democrats on Tuesday to make a deal to modernize the country's infrastructure after his plan received critical reviews as lacking enough federal funding, but said he was open to changes.

"I actually think that we can go bipartisan on infrastructure," Trump told a meeting of lawmakers at the White House. "We put in our bid. Come back with a proposal. We have a lot of people that are great Republicans that want something to happen. We have to rebuild our country."

The White House wants to use $200 billion in federal funding to try to encourage $1.5 trillion in improvements over 10 years by relying on state and local governments and the private sector. It also wants to eliminate environmental hurdles to projects and sell off federal assets.

Democratic Senator Ed Markey said the plan "expects cash-strapped states to drive most of the progress on 1/8th of a tank of gas. We need $1 trillion in direct federal spending to rebuild our infrastructure."

Transportation Secretary Elaine Chao said the plan would "empower decision-making at the state and the local level, because state and local officials know best the infrastructure needs of their communities."

Chao will appear at a March 1 Senate hearing on the plan.

Fitch Ratings said in a research note on Tuesday it could be "challenging" for states and local governments to come up with funding. The plan "includes limited additional federal funding and lacks a long-term solution for the federal highway trust fund, which serves as the primary source of existing federal infrastructure funding," Fitch said.

Democrats want $1 trillion in new federal spending and say the government must find new revenue sources to pay for crumbling roads. The U.S. gas tax has not been raised since 1993 and Congress has shifted more than $130 billion to shore up the highway trust fund since 2008.

Auditors say the trust fund will need an additional $107 billion through 2026 to keep pace with current spending.

Chao said on Tuesday the administration was weighing a range of options to fund public infrastructure projects, including a higher tax on gasoline.

Republican Senator John Kennedy said any improvements must be paid for. "I need to know where the money's going to come from," adding he did not want "to borrow more money from China."